Beware of Fake Bank Websites with High-Rate CDs

UPDATE 4/3/2019: The scammers are advertising a new website. See below for details.

In the last month, two readers have emailed me about a suspicious website claiming to be a member FDIC bank. Each had a similar but different web address and name. Both were advertising CD rates that were higher than current top rates from banks and credit unions. Instead of asking visitors to apply online or physically visit their office, the websites asked visitors to “open a new account today 866-###-####.” With CD rates starting to fall, criminals may be exploiting the fact that savers are rushing to lock in “high” rates.

I investigated both websites. Before I had a chance to contact the FDIC, the first website disappeared. The second one lasted longer. When I contacted the FDIC about this second website, the FDIC call representative confirmed my suspicion. The FDIC considered it a fraudulent website pretending to be a FDIC member bank. Before the end of that day, the website disappeared. It appears that the FDIC is able to get these websites taken down once they learn of them. The problem is that the criminals are creating new websites with new web addresses when the old ones are taken down. The important thing to know when you are looking for good CD deals on the web is to be suspicious of new supposed bank websites with unusually high CD rates.

Below are snapshots of these fake bank websites so you will know what to avoid if another one pops up. In a future post, I’ll describe the ways that you can confirm that a bank website is legitimate. If DepositAccounts (DA) does not have a page for an institution on our site, you should be cautious. It is possible that we have not yet picked up a new website that a bank or credit union has created, but it’s also possible that it is a website created by a criminal pretending to be a bank or credit union. To search for an institution at DA, just type its name in the search box that’s at the top right of every DA page.

Below is a snapshot of the fake bank’s old home page (before it was deleted) with the phone number covered to prevent anyone from calling. I actually called the number using an untraceable phone after my call with the FDIC. When I called the fake bank’s number, a supposed receptionist answered the phone, and the first thing she did was to ask for my name and phone number. I avoided giving that information and asked for bank and CD details. She said she would forward me to an account specialist who could answer my questions. After waiting a few minutes, she returned and said they were busy and asked again for my phone number. I declined and hung up the phone. It is possible that they are hoping to entice people to wire them money to fund these supposed CDs, or at the very least, they are hoping to gain personal info from the callers.

There were several suspicious issues with the website. Below is an image showing the CD rates they were listing. The rates were not only unusually high, but the 12-month and Jumbo 12-month CDs were listed as no-penalty CDs.

UPDATE 4/3/2019: The scammers have come out with another fake website. They were advertising it on Google this morning. Below is a snapshot of the Google Ad. Please refer to this new blog post for the details.

Bottom line, if you have doubts about a website being a legitimate bank website, you can call the FDIC call center at 877-ASKFDIC (877-275-3342). That’s the number I used to check on these sites. Calling is also useful to alert the FDIC when these fake bank sites re-appear under other addresses.

In a future post, I’ll describe the web resources the FDIC and the NCUA offer to research and verify banks and credit unions.

Thanks for the warning Ken. I have seen some of these sites before and they were posting really high interest rates like 5-6% APY. That was a immediate red flag for me so I did some digging and could not find a FDIC number for the bank. The sites always quickly disappear.The scammers are getting smarter because these rates are good but not in the too good to be true category.As always this site is a great resource. If the bank isn't listed here I'm immediately suspicious.

Thanks, Ken.Yes, people need to be careful. When shopping online, even Google will often bring up sham online "stores" advertising prices maybe 25% better than competitors that are shams. If all either the "CONTACT US" or "ABOUT US" links have are online-fill-in forms (with no physical address listed that you can google to verify) AVOID, they're scams.

People laugh at the notion of ever being taken by the "Nigerian Prince" (or the "I'm in Jail!") scheme, but the reason these and so many other frauds continue to operate is simple: people FALL for them.

Don't only double check on FDIC / NCUA gov site the bank info and that they are active but importantly, also make sure you check the URL of the bank is correct, not just the name. I normally copy/paste that URL to go the bank site from the government site, and ONLY go to promotion page from there for any promotion or account application I am interested in.

A couple of times legit bank had wrong URL on FDIC site and I first had to make sure the URL is still valid for the page with good CD rate. Otherwise, nothing prevents a crook from creating a fake Bank of America site bankofameirca.com and offering great rates there...

with totao respect and admiration fot this web sitehow do we know its postings are legit?i am being nice, fair, and respectfuljust using your cautions on this site as you suggest for other sitesif i am out of line, off base,or terriblei completely appologize and retract my question and offer complete respect

In the environment we live in, what people chose to believe as fact is more in question then ever. That said, positive experience with a source such as Deposit Accounts give it substantial equity to me as a very credible source of banking news. Furthermore, unlike the scam sites discussed above, Deposits Accounts isn't trying to entice you to open accounts with them. Although the site has become more commercial since it was sold to Lending Tree, I've never seen Ken's articles or sponsored advertising look shady.

Good thing about ACH and wire transfers is that most legit bank sites look up a database and show the bank name once you enter the routing #. So that eliminates my worries on the destination being a fake bank. Of course never send endorsed checks or transfers to individual accounts for sure.

Don't only double check on FDIC / NCUA gov site the bank info and that they are active but importantly, also make sure you check the URL of the bank is correct, not just the name. I normally copy/paste that URL to go the bank site from the government site, and ONLY go to promotion page from there for any promotion or account application I am interested in.

A couple of times legit bank had wrong URL on FDIC site and I first had to make sure the URL is still valid for the page with good CD rate. Otherwise, nothing prevents a crook from creating a fake Bank of America site bankofameirca.com and offering great rates there...

A bank called Midwest bank with offices at 601 S. Figueroa street Los Angeles Ca 90071 has offered a 15 month cd at 3.4% interest. How due you find out if this is a scam and if it is what can you do if you transferred them money and are awaiting them to send the cd certificate?

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